Results Based Management

Introduction to Results Based Management

Origins of Results Based Management?

• Began with Peter Drucker and MBO in 60s• Evolved into the Logical Framework for the

Public Sector in 70s• Adopted vigorously by UK and New Zealand in

80s and USA and OECD countries in 90s• Formally became one aspect of New Public

Management in 90s• Is now being adopted to direct and justify

increased development aid.

What is Results Based Management

• Focuses on tangible results to be delivered

• Clarifies Clients and Mandate of Organization

• Promotes Benchmarking and Performance Analysis

• It emphasizes value-for-money

Why Results Based Management?

• The public want better services• More effective resource allocation• Private sector seeks improved

infrastructure and services• The public sector agency wants to

perform more efficiently and effectively

Starting Point is Performance/Results

• Why does this organization exist?

• What would be lost if it did not exist?

• Who does it serve?

• What is it supposed to deliver for them?

Alternative Approaches to Managing Performance

Management by Inputs/Activities

• Success is measured by expenditure and/or extent of activity.

(How much did we spend on this workshop?)

Alternative Approaches to Managing Performance

Management by Outputs

• Success is measured by the extent of goods/services delivered and the ratio of inputs to outputs.

Alternative Approaches to Managing Performance

• Success is measured by effects/impacts achieved, and their sustainability.

(What were the concrete agreements arrived at?

- After six months: Have these been fulfilled?

- Is the quality of Performance Management improving?)

Recent Approaches to Performance (Results)

Management

• Input - Output - Outcome Indicators

• Client Satisfaction Surveys

• Balanced Scorecard Approach

Key RBM Concepts

Inputs_____ Outputs

OutcomesActivities

Key RBM Concepts

Input / Activities = Used to Produce Outputs

Outputs = Produce or Service Delivered

Outcome = Result or Effect or Impact of the Output

KRA = Operating Areas in which outputs have to be delivered

Outputs / Outcomes

• Outputs are generally under direct control of agency

• Outcomes are not under complete control

- are subject to numerous other influences- only surface over time- hence, attribution becomes an issue

Intermediate Final

Inputs Outputs Outcomes Outcomes

New WS Access toSystem Drinking Water

Reduced• Staff New Waste Proper Garbage

Infectious• Resources Mtg System Disposal

DiseasesHealth PersonalEducation CleanlinessProgram

Public Sector Performance

• At a National Level

• At a Sector Level

• At an Institution Level

• At a Project Level

Client Satisfaction - The Report

• Covers Essential Services

• Focus on Processes, Outputs, Outcomes

• Uses Sample Surveys

Composite Result Indicators

• EffectivenessRatio of inputs to outcomes achieved

• EquityExtent of access to service by different clients groups

• EfficiencyRatio of inputs to outputs

• SustainabilityAbility to sustain operations financially

Integral to Capacity Building

• RBM drives continuous performance improvement

• Performance information of RBM is essential for CB - benchmarking, performance shortfalls, cause analysis

• Can’t do meaningful CB without RBM

The Diagnostic Approach

• Begins with the analysis of performance

• Identifies critical performance gaps or opportunities for improvement

• Works back to identify variables influence performance

• Develops an Organization Development Plan to address constraining variables

Begin with Expected Results

• ‘Performance Report’ is essential• Identify performance variances in

order of priority• If performance variance is not clearly

identified- diagnosis is not possible

- capacity building initiative will be directionless

Performance Variance

Expected Performance ……

varianceActual Performance

Expected performance ………variance

Actual performance

Category 1 Factors -Clarify of Results

Outputs Outcomes

Category 1 Factors - Results / Performance

Expectations• Are performance results specified?

• Are there clear standards and / targets?

• Are performance results monitored and analyzed for improvement?

• Is performance periodically reported?

• Is performance periodically audited?

Category 2 Factors - Resources

ResourcesResults

• Staff / Skills• Budgets• Technology•Equipment•Physical Assets

Outputs Outcomes

Resources and Performance

• The ‘Wheels’ on which the organization runs

• Proportionality between Inputs and Outputs- Efficiency: ratio of outputs for each unit of input

- Effectiveness: ratio of outcomes for each unit of input

Focus on Resources

• Resources are often the first and only focus of some CB strategies

• Typical CB strategies resorted to are - staff increases- training- computerization- increased operating budgets

Category 3 Factors - Management Infrastructure

Management InfrastructureSystem + Structure + Strategy(Processes) (Policy)

Resources•Staff•Budgets•Technology•Equipment•Physical Assets

Outputs Outcomes

Structure

• Clarity of Accountabilities & Reporting Relationships

• Span of Control

• Level of Delegation

• Quality of Outreach to Client

• Checks and Balances

• Structure can complicate Processes

Systems and Processes

• Planning and Decision Making Systems• The Client Interface System• The Product Delivery System• The Financial Management System• The HR Management System• The Information Management System• Performance Monitoring and Reporting

System

Structure

• Clarity of Accountabilities & Reporting Relationships

• Span of Control

• Level of Delegation

• Quality of Outreach to Client

• Checks and Balances

• Structure can complicate Processes

Systems and Processes

• Planning and Decision Making Systems• The Client Interface System• The Product Delivery System• The Financial Management System• The HR Management System• The Information Management System• Performance Monitoring and Reporting

System

Vision (Leadership)

• Is the “Core Ideology”

• Primary Driver

• Impels Change & Results

• Is the priority accountability of leadership

• Is the clearest reflection of quality of leadership

Typical Values

• Quality Consciousness

• Client orientation

• Teamwork

• Innovation

• Openness to Change

Values - Culture

• The fundamental Guiding Principles

• The unsaid but expected behaviors

• The ‘norms’; what is considered important

• The favored patterns of interaction

• The way we do things around here

• The ‘management style’

The Drivers

Vision and ValuesOR

Leadership and Culture

• Efficiency is a function of Management Infrastructure

• Effectiveness is a function of Leadership and Culture

Organization Model for Diagnostic Analysis

Vision Values

Systems Structure Strategy

Resources Results